How online sellers can avoid hefty currency exchange fees

Millions of businesses in the UK sell goods online to buyers both at home and abroad, but keeping foreign currency charges to a minimum should be a priority if you want to maximise profits.

Businesses which sell online via marketplaces such as Amazon, Etsy and eBay added an estimated £11 billion to UK exports last year, according to a report commissioned by international payment specialists WorldFirst. This is forecast to grow to £21.3 billion by 2020.

The report, carried out by the Centre for Economics and Business Research (Cebr) says that over half of ‘iStreet sellers’ - defined as business with less than 50 employees who sell goods and services using online marketplaces - have seen growth in the last 12 months, with the EU the most popular trading destination.

Last year’s Brexit result certainly hasn’t dented the confidence of internationally trading businesses, with separate research from foreign exchange and international payments experts Moneycorp showing that EU currency transactions increased 100% in eight weeks following the referendum vote.

Take care when transferring funds from overseas

Some of the biggest difficulties online sellers can face is paying international invoices or transferring funds from overseas sales back into sterling. Despite high street banks often offering poor exchange rates and steep fees, many businesses still rely on them to transfer money. This can sometimes result in being charged twice for the same transaction, both in the country you’re exporting to and in your home country.

Save money by using a specialist foreign currency provider

Using a specialist foreign currency provider can help keep these costs to a minimum and ensure you’ll only be charged once, enabling businesses to hang on to more of their profits.

Some foreign currency specialists, such as The Telegraph’s business money transfer service provided by Moneycorp, enable you to hold up to 32 currency balances online, and to make foreign exchange deals and payments from one simple log-in. You may also be able to secure an exchange rate for a set period of time, meaning you won’t be adversely affected by fluctuating exchange rates.

Check the laws of the country you’re exporting to

Remember that when selling goods or services overseas, it’s vital that you don’t fall foul of the laws in the country you export to. Make sure you speak to a specialist before selling to overseas buyers as they should be able to let you know which bits of paperwork you’ll need to fill out, and any rules you’ll need to abide by.
It can also be a good idea to chat to other business owners who already export to countries you are planning to sell to, to see if they can offer any useful tips or advice.

What if I only sell products in the UK?

Even if you only sell goods in the UK, you may still have to pay international suppliers. Again, using a foreign exchange specialist will usually be much more cost-effective than a high street bank if you need to make regular payments overseas. They can often specifically tailor their services to your company's needs, giving you up-to-date market information and insight, so you can advantage of any opportunities and warn you about any risks before you make your transfer.